DETERMINE WHO HAS EMAIL
You must segment your mailing to identify customers who have promotable email addresses (meaning customers who welcome marketing emails vs. those who only want correspondence about their transactions or their spefici business with you) and customers who do not. This sounds trivial, but it’s a critical part of making the most of your marketing budget.
For example, customers who receive contacts electronically (email) and in print (through the mail) are up to four times more valuable to you. Why?
Because you can increase response and revenue per customer if you send both an email and a mailing. These additional contacts keep your company top of mind, which quantitatively translates to greater revenue and profitability.
If your marketing budget has been cut back, however, you could omit customers from the mailing who have a promotable email addresses since you have an alternate way to contact them. You can also take out inactive or lower performing customers from a mailing, if you have promotable email addresses for these names, and send them a less expensive email contact.
TIP: Testing shows you can reduce contacts but generally not omit them completely — it’s the combination of offline and online that yields highly productive customers. But if your company is not able to put email addresses on your database, you can always provide the email file to the vendor responsible for the data processing of the mailing.
The vendor can often match customer numbers between the email file and mail file. If this is the case, an indicator can be applied to each customer record for you to complete your segmentation.
YES, MAIL INACTIVE CUSTOMERS
The cooperative databases are able to apply a probability score to your entire customer and requester file. The analysis assigns a score to each record. The best score is 1, and the worst score is 20.
Armed with this data, you can now choose to mail inactive customers with a score of 1 (or test into scores 1-5, or 1-10, etc.) You will likely experience results similar to a prospect list — or even better.
And you can revisit how to strategically mail one-time buyers or buyers with a low average order value. Since it’s generally accepted to omit low performing segments, such as one-time buyers, you can now customize which records you omit from the mailing using the scoring provided by the co-op.
Instead of dropping an entire segment, opt to mail one-time buyers whose probability score is 1. You should test into the scores that work best for your business. For example, you may find you can mail scores 1-15 for more recent customers, and scores 1-3 for your oldest customers.
TIP: Consider testing mailing score 99, which is the “unknown” score. This score can be highly productive!
MAIL MULTIPLES IN B-TO-B
For business-to-business mailings, determine the maximum quantity of catalogs to send in to each company for each mailing. You will definitely mail to the individual buyer on your database, but you need to determine if there are other individuals, or departments, that should also receive the catalog or mailing.
Do not limit yourself to one per company. If you don’t find other individuals for that particular company on your database, make sure your merge/purge instructions indicate that you want to mail additional individual prospects. This means if a record on a rental list matches a company on your database, the prospect is mailed if the individual name is different.
To strengthen your prospecting, you can implement a variety of merge/purge business rules based on different circumstances. You may opt to mail only one catalog to a company with five or fewer employees; but for firms with 25 or more employees, the business rule might be up to six catalogs, as long as the individual names are unique.
TIP: If the individual name field is blank, evaluate the opportunity to use a title slug, such as office supplies manager R&D engineer or assistant to the CEO. Choose a title slug relevant to your business. If you’re not sure, interrogate your database and find the specific title used by the majority of your best customers.
ISOLATE THE SUPERDUPES
Another name for a rental record that matches your customer database or house file is a superdupe. Standard merge/purge business rules will drop the record from the rental list and keep the record in the house file.
This is good policy, but what happens when the rental dupe matches a lapsed customer — and the lapsed customer is in a segment you will eventually omit from the mailing?
There are two ways to make sure the record is mailed. Both address the situation as part of the merge/purge instructions.
One practice is to isolate all superdupes and rekey them as their own segment. This process ensures that you always mail the superdupe group no matter where the record resides in the house file segmentation.
The other practice is to flag (identify but don’t remove) the records in each segment. Doing so allows you to rekey the superdupes within each segment. And when you do post-analysis, you’ll be able to roll-up the data and maintain visibility to your planned segmentation.
IGNORE DOLLARS PER BOOK
Planning a mailing usually takes into consideration the segment’s response rate, average order value and revenue per catalog. The problem with this macro view of segmentation is the lack of a specific criterion for prospecting.
Prospecting, or customer acquisition, should be primarily based on response rate — it’s the whole reason for initiating the effort. Of course, there is a performance threshold, and it’s usually a payback period. The payback period is different for each company and based on the historical break-even performance of that particular list or those prospects as a whole.
Deliberately evaluate prospecting lists with a high response rate and an average revenue per book. And make sure that you watch your first-time buyers to ensure that their second purchase and subsequent purchases are meeting expectations for the payback period.
ASK THE EXPERTS
Talk to your data processing vendor about other processes that may be helpful to your business. Consumer catalogers have the option to identify when to mail two catalogs to one address; for etailers, there are opportunities to mail differently around a store radius.
And b-to-b merchants can evaluate suppression files to confirm if they are suppressing an individual or the company address. All of these nuances make a difference in your mail plan — and, ultimately, your bottom line.
Gina Valentino (firstname.lastname@example.org) is president of catalog/multichannel consultancy Hemisphere Marketing.